If you've been paying attention to the monthly reports from the U.S. Bureau of Labor Statistics, you might have noticed that workers are still quitting their jobs in high numbers, even as the pandemic and inflation continue.
In this segment of Backstage Pass, recorded on Nov. 5, Fool contributors Toby Bordelon and Rachel Warren discuss the trajectory of The Great Resignation.
Toby Bordelon: We got some really good news on the jobs trend. We've got non-farm payrolls up 531,000 in October, that was above our 450,000 estimate we had before. These typically get revised the next month, so who knows where that's going to land. But for now good news, unemployment under 4.6%. This is the lowest level it's been since the pandemic started.
Wages up a little bit 0.4 percent but year-over-year wages were up almost 5%, 4.9% from a report today. I think this is good, this is better news for us getting back to normal, the jobs increase seems to have been led by leisure and hospitality. That's really good. That was a really hard-hit industry, seems to be coming back now.
I have a chart here, I just wanted to show people for context here. Take a look at this. You can see this is the unemployment chart right here. You see, obviously this was our pandemic here. We're getting back up to good levels not quite back to where we were before, but getting close to normality and 4.6% is not that bad.
Here's the question. The numbers are good. We're also hearing about this 'Great Resignation' that Rachel mentioned earlier. This is that theme, people just leaving the workforce. How temporary do you guys think this is, that people quitting? You hear a lot of talk, you hear a lot of stories.
Are these stories or is there something lasting behind this or maybe this is just people saying, look, last year or two has been rough. I just need to pause, I just need to think, consider where I go, but they're going to come back to work.
They are ultimately going to get back to work or do you think we've got a decent chunk of the workforce that might just opt out? I'll start with you, Rachel, what do you think?
Rachel Warren: Yeah. I love this question. I do personally see this continuing for some time. I think there has been such a reset in the way many people are looking at life and how they want to live it since the pandemic began. I think from a business perspective, the pandemic has shown many companies, certainly not all, but many.
Your employees can be just as productive, if not more productive working from home as when they are in the office. I think more and more people during the pandemic, maybe moving out of the cities, they like the option to potentially choose where they want to live, or perhaps to relocate to a different place that's more affordable or where they want to be because of remote work.
I think if an employer doesn't offer that option, I think one of the things you're seeing is a lot of people are really fed up with the status quo and they want to do something different. I could see that continuing for some months at least. But I do think it's also important to mention some of the industries where you're seeing the highest of quit rates, is a lot of times in the more service-oriented industries, which I don't think is probably a surprise to anyone.
Some of the working conditions and wages and then during the pandemic that has been a particularly difficult environment for so many workers that have had to contend with everything that's been going on. I don't think it's surprising that workers and rightfully so are perhaps demanding safer working conditions, and perhaps better pay and if their employer won't or is not in a position to offer that they can look elsewhere.
But I do think it's interesting that some companies, I had talked about this on a show not that long ago, are seeing completely full employee rosters because they are changing the benefits that they're offering. Sam's Club is a great example. One of their management said recently that essentially they weren't looking for more workers.
They were completely full essentially because they had done these things like offering career advancement, higher wages. They were not facing this great labor shortage heading into the busy retail season because they had made those changes. Clearly, it's working for some companies that were doing these things and obviously Sam's Club is a huge company and they have a lot of capital to work with.
I think employment numbers will continue to rise, I think it will be gradual. I saw this really interesting study (from Visier) and it was Four Things We Learned About the Resignation Wave and What to Do Next.
One of the points was that in 2020 people wanted to quit, but in 2021 they actually did it. Another point that was interesting in the study was that the resignation trend affected mid-tenured employees more. Between 2021, things really changed. The current resignation rate of employees with a five to 10-year tenure is 56.8% higher than in 2020.
It wasn't just young people quitting either. The study also found that employees between the ages of 30 and 35, 40 and 45, and 45 and 50 had all increased their resignation rates by more than 38%.
Then another interesting statistic from the study was that women are resigning at much higher rates than men, which I think stems from a lot of reasons. Maybe it's harder sometimes for women to find child care when we've talked about before as well. Also, there's been a lot of studies that women have faced a lot more burnout in the workplace than men as well.
I think that these are really positive numbers. I was really happy to see the jobs report, but I think it's something that is going to take some time. I think employees have a lot of bargaining power right now because it's not so much that they're, it's not that there's a shortage of opportunities.
But I think that there's a lot of opportunities that people are saying, you know, I'm going to do this. I can do something different.
